Transfield Services won a $1.2bn contract to provide welfare and infrastructural services at detention camps on Manus Island, above, and Nauru. Photograph: Getty

Last Friday, the seemingly impossible happened. Luca Belgiorno-Nettis, director of Transfield Holdings, resigned from his position as chair of the board of the Biennale of Sydney. He tweeted “I hope that blue sky may now open over this 19th @biennalesydney”, as the Biennale simultaneously dropped Transfield’s funding.

Despite this being a proof of the power of the boycott, and a precedent for new ways of taking action against the policy of mandatory detention, the commentariat rushed to condemn the announcement as soon as it was made. Many contributions, such as this Sydney Morning Herald piece and this one in The Conversation, put forward two theses: 1) that this was a blow for arts sponsorship and 2) that encouraging divestment from Transfield is pointless because mandatory detention is the government’s policy. Artists were dismissed as hypocrites for accepting government funding, despite the evident difference between tax-collected funding and profits from incarceration. These arguments also purposefully misunderstand the point of the boycott and deny the power of this crucial step towards disrupting the private supply chain on which Australia’s cruel “deterrent” policy depends. There is no way of separating government policy from industry infrastructure; the detention regime in Australia is a public-private partnership.

This is not about corporate arts sponsorship. The artists who jeopardised their careers, the activists who worked with them and those directly affected who called for the action all had one aim in mind. Theirs was a boycott against a system that indefinitely detains asylum seekers who arrive by boat, through a policy steeped in secrecy and violence which has already seen the killing of asylum seeker Reza Berati. Australia, the first country to introduce mandatory detention of asylum seekers, has long been a global laboratory of deterrence strategies that foment popular racism.

Transfield Services won a $1.2bn contract to provide welfare and core infrastructural services to the detention camps at Nauru and Manus Island. The attempts to distance Transfield Holdings, the private family company of Luca and Guido Belgiorno-Nettis, from these profits are obfuscations. Transfield Holdings is the second largest shareholder in Transfield Services, and while Luca and his brother no longer sit on the board of Transfield Services, that does not mean his interests are not represented. The Transfield Foundation, through which the Biennale was funded, is backed jointly by Transfield Holdings and Services. And Luca, it bears reminding, is on record as saying that Transfield is doing “nothing wrong” in profiting from mandatory detention.

Most importantly, as was emphasised by the boycotting artists, the entire Transfield brand, and not just its subsidiaries, derives value from its philanthropic activities. And while the investment in the Biennale may have been small (about 6% of its overall budget, not including in-kind), the benefits reaped were huge: it was an exercise in culture washing on a city-wide scale.

The call to boycott the 19th Sydney Biennale was made in an open letter by a Sydney arts educator, Matt Kiem. However, this was a step along a path that leads back to the Woomera protests of 2002. Renewing the commitment to dismantle the camps, in December 2013 a meeting organised by the Beyond Borders Collective in Melbourne triggered discussions of boycott, divestment and sanctions. This momentum also led to a working paper, a research and information website, a video detailing the connections between Transfield and the Biennale, and social media debates. Boycott strategies were publicly supported by Australia’s only organisation of refugees and ex-detainees, RISE, and have been called for by those in the camps at Nauru and Manus Island, the hunger strikers at Christmas island and those at Villawood whose lead we follow, and whose resistance within the camps themselves has had a massively understated role in accounts of events around the Biennale.

Those who bemoaned the end of the Transfield-Biennale relationship are wrong in believing that things end here. The Biennale’s decision to sever its 41-year ties with Transfield is proof that divestment is a reality. We believe that many people, not only a few principled artists, can see that it is hypocritical to profit from the degradation of one group – asylum seekers – to support another.

Superannuation funds, city councils and universities around Australia also have links with Transfield and other providers of detention infrastructure. One by one we will insist that these institutions divest their connections to the mandatory detention infrastructure. The artists – including those on Manus Island whose art forced them to flee in search of a better future – have shown them the way.